Palestinians say boycott of five Israeli food firms is tit-for-tat

JERUSALEM (Reuters) - The Palestinian government ordered a boycott on Tuesday of five Israeli food-makers, saying it was responding to Israel's decision to stop admitting Palestinian-made produce from the occupied West Bank to East Jerusalem.

With immediate effect, Palestinian vendors were barred from buying from Tnuva, Strauss Group Ltd., Tara, Soglowek and Tapuzina, but they could sell their existing stocks, the government said.

An Israeli official who spoke to Reuters on condition of anonymity said the products did not meet required standards.

"This was a long-running problem, and Israel finally got fed up with their foot-dragging," the official said of the step, taken two weeks ago.

Israel has extensive commercial ties with Palestinians in the West Bank and in East Jerusalem, which it annexed after a 1967 war in a move that was not recognized internationally.

A spokeswoman for Israel's Economy Ministry said it had not received official word of the Palestinian boycott and therefore could not respond. The five Israeli firms affected did not offer comment on the possible cost of the boycott.

"Around 900 people are working in these five companies. We were forced to lower working hours. Nearly 50 percent of the products of these companies are sold in Jerusalem markets," said Hamouda sales director Amir Haddad.

"We have been sending our products into Jerusalem for 16 years. The licence gets renewed every six months," he said. "How come they never told us officially if goods do not meet standards?"

Of the five Israeli companies targeted by the Palestinian government decision, Tnuva stands to make the biggest losses, though of only around 3 percent of its total sales, according to a tally last year by the Haaretz newspaper. China's Bright Dairy and Food Co Ltd controls Tnuva.